Renee Sants Industries sent a purchase order for certain steel products to Kentucky Electric Steel referred to as KES. RS's purchase order contained a clause stating that they would not be bound by any terms other than those in its purchase order unless it agreed in writing to a change of the terms. KES responded with its standard order acknowledgment form and the form contained a limitation of liability clause that limited KESs liability for defective goods to replacing the goods or allowing the buyer a credit for them. RS later filed a breach of contract suit against KES arguing that some of the goods received did not conform to the contract specifications. RS asked for a damage award based upon damage to its fabricating machinery and lost profits that they claimed resulted from KESs breach. KES obviously argues that such damages are not allowable for several reasons.

Please discuss the various positions. First of all, please analyze whether or not there is a valid offer and acceptance. Second, please discuss the various contents of the offer, if any, and the contents of the acceptance, if any. Third, please look into the damages issue as is requested. Please discuss what would have been allowable and not allowable and the reasons for your decisions.